ENERGY MARKETS: Concerted Actions Needed by FERC to Confront Challenges That Impede Effective Oversight
Abstract
Consumers in various parts of the United States have experienced substantial fluctuations in the prices they pay for natural gas and electricity as these industries make the transition from regulated monopolies to competitive markets. These fluctuations-the most notable in California during the summer of 2000-have caused some consumers and state officials to question the wisdom of moving to competitive energy markets. They have also raised concerns about the ability of the federal government to adequately regulate and oversee these new markets. The responsibility for ensuring that wholesale prices for natural gas and electricity, sold and transported in interstate commerce, are "just and reasonable," generally rests with the Federal Energy Regulatory Commission (FERC). The Chairman of the Senate Committee on Governmental Affairs and Senator Carnahan asked GAO to determine (1) how FERC has revised its regulatory and oversight approach in response to the new energy markets and (2) what management challenges FERC faces in effectively regulating and overseeing these markets. To respond to the request, GAO reviewed relevant legislation, regulations, studies, and documents pertaining to FERC's regulation and oversight of these industries. GAO also interviewed a wide range of current and former FERC Chairmen, Commissioners, and officials. In addition, GAO surveyed FERC staff in the Office of Markets, Tariffs and Rates and related sections of the Office of the General Counsel who have primary responsibility for regulating the natural gas and electricity industries. About 71 percent, or 271, of these 384 staff responded to GAO's survey. Furthermore, GAO obtained information from a wide range of FERC's stakeholders-including state and industry representatives-and other industry experts. For example, GAO surveyed the chairmen of the state public utility commissions or boards. Thirty of the 49 commissions or boards responded to GAO's survey.
Document Details
- Document Type
- Technical Report
- Publication Date
- Jun 01, 2002
- Accession Number
- ADA402641
Entities
Organizations
- United States Government Accountability Office